British banks handled vast sums of laundered Russian money
Britain’s high street banks processed nearly $740m from a vast money-laundering operation run by Russian criminals with links to the Russian government and the KGB, the Guardian can reveal.
HSBC, the Royal Bank of Scotland, Lloyds, Barclays and Coutts are among 17 banks based in the UK, or with branches here, that are facing questions over what they knew about the international scheme and why they did not turn away suspicious money transfers.
Documents seen by the Guardian show that at least $20bn appears to have been moved out of Russia during a four-year period between 2010 and 2014. The true figure could be $80bn, detectives believe.
One senior figure involved in the inquiry said the money from Russia was “obviously either stolen or with criminal origin”.
Investigators are still trying to identify some of the wealthy and politically influential Russians behind the operation, known as “the Global Laundromat”.
They estimate a group of about 500 people were involved. These include oligarchs, Moscow bankers, and figures working for or connected to the FSB, the successor spy agency to the KGB.
Igor Putin, the cousin of Russia’s president, Vladimir, sat on the board of a Moscow bank which held accounts involved in the fraud.
British-registered companies played a prominent role in this extensive money-laundering network. The real owners of most of the firms used in the scheme remain secret, however, because of the anonymity provided by controversial offshore laws.
The Global Laundromat banking records were obtained by the Organized Crime and Corruption Reporting Project (OCCRP) and Novaya Gazeta from sources who wish to remain anonymous. OCCRP shared the data with the Guardian and media partners in 32 countries.
The documents include details of about 70,000 banking transactions, including 1,920 that went through UK banks and 373 via US banks.
The Laundromat — the biggest money-laundering operation yet uncovered in post-Soviet territory—was unusually well connected.
Some of the banks involved were linked to a relative of Russian President Vladimir Putin and a former Kremlin official.
Moldovan authorities say that in the past three years about US$ 20 billion was illegally moved out of Russia into the European Union. The money-laundering scheme involved 19 Russian banks, a bank in Moldova and a bank in Latvia. Using fake loans and contracts, money was sent from Russia to Moldova and then into Latvia. They system relied on Moldovan judges to legitimize the transfers. Moldovan investigators are looking at the role of the judges in the scheme.
Ruslan Milchenko knows all about how the system work. A fomer member of the Russian police, today he heads the anti-corruption agency Analitika and Bezopasnost (Analyses and Security). He said banks knowingly engage in this uniquely Russian banking service.
“Imagine that you have US$ 100 and its origin is doubtful. You just go to such a banker and tell him that you need this money somewhere in Hong Kong. If you don’t have a company or a bank account there, the banker will sell you one. … In a couple of days you receive 96 or 97 dollars, depending on the commission (charged) in Hong Kong, or any other place in the world. And you as the client will not know the route of your money – that is the money launderer’s job.” (see complete interview with Milchenko)
It is not clear what was known by the banks involved. Currently there is no investigation in Russia involving the banks used in the Laundromat system.
interesting story..involves a putin..this could also involve some levels of propaganda..
“The Laundromat — the biggest money-laundering operation yet uncovered in post-Soviet territory—was unusually well connected. Some of the banks involved were linked to a relative of Russian President Vladimir Putin and a former Kremlin official.”
and the banks..bastions of society..
“HSBC, the Royal Bank of Scotland, Lloyds, Barclays and Coutts are among 17 banks based in the UK, or with branches here, that are facing questions over what they knew about the international scheme and why they did not turn away suspicious money transfers.”
who will go to jail?